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Private firms and GP consortia team up in profit-sharing schemes

By Ian Quinn

GP pathfinders covering hundreds of thousands of patients are in advanced talks with private firms to launch profit sharing incentive schemes for practices in return for slashing NHS spending.

Under new models being developed by the first waves of GP pathfinders, private firms plan to share financial risk with consortia, in return for performance related payments, with individual practices getting a slice of the money saved – which it has been speculated could amount to up to 15% of practice income.

Integrated Health Partners (IHP), a company working with 15 GP practices near Guildford, in Surrey, has plans to raise funding from the City, possibly by floating on the stock exchange, which would allow private investment to bankroll the risk for consortia.

Under its model GP practices agree to submit to vigorous performance management of their referrals, and the firm has already offered its consultancy services NHS Surrey, a PCT with one of the largest deficits in the country, where it claims to have made gross savings of 5%.

Founder and managing director, Dr Oliver Bernath, said it was developing a model based around private investment and GPs sharing risks and profits after they take on full responsibility for commissioning in April 2013.

Dr Bernath, a consultant neurologist and former executive of management consultant firm Mckinsey, said: ‘We think the right answer going forwards is that GPs, who will have quite a bit of personal income at risk, would be able to share in the underspend that we achieve and the private organisation that takes a share in that risk will also have a share of the underspend.’

‘We are not talking about making profits just by blocking referrals because as consortia will be in charge of the whole budget, simply blocking referrals will not save them money, that would be very short-sighted.

‘The fundamental thing that we want to provide is better healthcare for less. If we want to get the private capital in we have to work how private capital works.

‘That private sector money would have to take some of the NHS risks – I think that’s good.’

IHP, which is focus of a Channel 4 News investigation tonight, was hailed by the now health secretary, Andrew Lansley, before the lection, as a model how GP commissioning could work.

Dr Bernath told Pulse: ‘The message from Andrew Lansley’s office is very much that he wants GPs to be able to develop their own ways of making this work.’

However, the BMA and the Government at loggerheads over plans for the role of the private sector and the incentives that will be offered to consortia to reduce referrals, with GPC chair, Dr Laurence Buckman describing them as ‘appalingly unethical’.

Dr Buckman told the BBC: ‘It appears that what we might actually be asked to do is to save money and if we save a certain amount of money we will receive some of our pay given back to us.’

Dr Oliver Bernath